South Africa awards $5.8 billion train deal to France's Alstom

Wed Dec 5, 2012 8:56am EST
 

JOHANNESBURG (Reuters) - South Africa's state rail agency on Wednesday awarded a $5.8 billion contract to France's Alstom SA ALSO.PA to supply passenger trains in a ten-year deal.

In one of the biggest government deals ever awarded by South Africa, Alstom will build 3,600 new train coaches to help overhaul the creaking rail network in Africa's biggest economy.

Several firms had bid for the 51 billion rand ($5.8 billion)contract, including Canada's Bombadier (BBDb.TO: Quote), Spain's CAF CAF.MC, Switzerland's Stadler Rail, China North Rail (601299.SS: Quote) and China South Rail (601766.SS: Quote).

The chief executive of the Passenger Rail Agency of South Africa, which awarded the contract, told reporters the deal was expected to create about 33,000 jobs.

South Africa is on a drive to improve public transport to the millions of poor who are without cars.

The contract is the biggest rail deal currently in the works anywhere in the world, according to one industry source. ($1 = 8.8073 South African rand)

(Reporting by Tiisetso Motsoeneng; Writing by David Dolan; Editing by Ed Cropley)